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Jack Mallers: “The Fed Has Blown Up Our Financial System”

With Bitcoin rallying, Jack Mallers, founder and CEO of Strike, appeared on CNBC and declared, “The Fed has blown up our financial system.” He then went on a tirade about how Bitcoin can help individuals protect themselves from inflation and even hyperinflation.

“There’s a market term that’s used here in Chicago a lot is ‘demand finds supply,’” said Mallers. “If Ken Griffin is going to want to buy the most expensive condo in America, someone will build it for him—someone will put a 201st floor in Miami’s tallest building. If silver is going to 1,000x, I will walk into my kitchen right now, I will melt all my silverware and I will sell it at market. If gold is going to rally, Elon Musk will find more on Mars.” 

Contarily, Mallers reasons, since Bitcoin is “the only monetary instrument in the history of our species that is fixed,” no one can ever make more of it—no matter how sky high demand goes. 

“There are two things I can guarantee you in my life: one that I’ll die and the other that there will only ever be 21 million Bitcoin,” said Mallers. “And those are the only two things that I can value: my life and my bitcoin.” 

In short, Bitcoin will increase in price because of its fixed 21 million supply

At that point, CNBC journalist Tyler Mathisen asks why the supply is fixed and can that be changed.

“It’s written in the software and the software is distributed,” ripostes Mallers. “There is no one person to ask, there is no one person to trust. Is [Bitcoin] decentralized so that you could put pictures and NFT’s on the blockchain? Is it decentralized so that you could fix gaming?”

No, says Mallers. “It’s decentralized so that the defendants of the monetary policy are distributed; so that it’s a network of computers that actually defend the policy and instrumentation of the monetary asset.”

He adds. “That is not the case for Ethereum; that is not the case for any other altcoin; that is not the case for the US dollar; that is not the case for Miami real estate, and that is not the case for precious metals. It is the only monetary instrument that has its monetary policy distributed and defended in a sound way.” 

Tyler then asks if the software can be rewritten and if a new Bitcoin 2.0 could be created. Mallers points towards Bitcoin Cash, the experiment spearheaded by Roger Ver to increase the block size. 

“I run Bitcoin software,” Mallers answers, preferably referring to the fact that he runs a node. He then goes on to Bitcoin Cash. 

“Someone said I want to change the rules of Bitcoin,” he said, referring to Ver. “I may want to create more of a supply, I may want to make it faster, I may want to make it do a backflip, I may make it want to store pictures of monkeys drooling on themselves on the blockchain, and they created it, and they created new rules and they call it Bitcoin Cash.” 

It’s a different asset, Mallers points out. “It’s a different instrument, and when someone tries to pay me in it, my software rules that I run in my home in a room over there says ‘Nope, that’s invalid: that thing is a piece of poop.’ And I don’t accept it because it is invalidating the rules of the system that were set out by Satoshi Nakamoto over a decade ago.” 

Mallers says anyone can create whatever they want. “You want to create a FedNow coin, flip a dookie coin. I don’t care. There’s 21 million of the things that I run and that I protect and that I save in. And those rules were started a long time ago, and that’s what the network runs. If you change the rules, you’re creating a different monetary asset, a different instrument. It doesn’t matter.”

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